Skip
Current Issue
This Month's Print Issue

Follow Fast Company

We’ll come to you.

4 minute read

Lessons Learned

The Unexpected Lesson I Learned From Losing A Multimillion-Dollar Business

Sure, failure may teach you a number of business lessons. But its impact on your relationships may be the most lasting.

[Photo: Flickr user Steve Snodgrass]

If you're an entrepreneur—and even if you aren't—you've probably read your fair share of articles explaining why it's okay to fail. In a weird, possibly twisted way, failure is almost like a badge of honor.

But failing still sucks. It’s one of the scariest and most gut-wrenching experiences a business owner can ever go through. I should know. It's what happened to me when Amazon shut down my business Organize.com. Right up until then, times were good. I was newly married and we were killing it financially. The month before the company closed, we raking in a profit of somewhere around $700,000. But our approval rating had dropped below that 96 or -7% satisfaction threshold Amazon requires for seller accounts.

After receiving the suspension notice, I had no choice but to let everyone go and shut down our online store for good. It was worse than terrible. Here's the thing, though. For all the talk of failing as a means of improving your business acumen and honing your strategic thinking, it may have a bigger impact on something much more personal: your relationships.

How Humility Helps

When the money is flowing, that's usually a sign business is good. And business really was good at Organize.com for a bit. But the success got to my head a little. I bought a nice car and began to neglect my friends and family. I spent more and more time focusing on growing the business and enjoying being a "successful business owner," and less time hanging out with those closest to me.

Losing everything, though, made me humbler—as you can well imagine. All of a sudden, you aren't as untouchable as you'd thought. In fact, researchers at the University of Washington and State University of New York at Buffalo discovered that "humble people tend to make the most effective leaders and are more likely to be high performers in both individual and team settings." It isn't about having low self-esteem, either. Humble leaders are simply more compassionate and focused on the welfare of the group they lead than on their own status.

I've tried to be as open as I can in sharing the experience of my misfortune with others, so that they may be able to avoid the same mistake. After losing my company, I decided to reshuffle some of my personal priorities. At a friend's suggestion, I also took some time off to give back to my community to volunteer.

Getting Reacquainted With What Matters Most

Close your eyes. Imagine everything that you already have in life. A house, car, business, family, friends, and so forth. What if they weren’t there? Poof—gone. You'd feel pretty lousy, right? But which of those things are you sorriest to lose? After my business folded, I realized I didn’t need luxury items. Who needs a BMW when you have a wonderful and amazing wife? Who needs a multimillion-dollar business when you have friends and family that support you no matter what?

Sure, this may sound obvious or even trite—but when you're at the helm of a fast-growing company, it's amazing what you can take for granted and lose sight of altogether. Losing pretty much everything made me realize I was still fortunate and successful because I was surrounded by some of the greatest people in the world. I didn’t take that for granted anymore, and I still try to remember this lesson everyday.

Time To Recharge And Refocus

Once I got over the initial shock of failure, I took a bit of a sabbatical. With my free time, I was able to connect with people I hadn’t seen in months. Whether it was just going out to dinner or taking a quick getaway, surrounding myself with those I cared about most helped me regain my footing rather than dwelling on my losses.

I enjoyed moments that I didn’t realize I'd been missing out on. And it was during this time that I realized how important it is to step away from your business periodically. These days, I no longer get sucked into working 24/7. I make it a point to spend time with my friends and family, and to attend only essential networking events. While I still work long hours when I really have to, I now know I need to spend time with the people I care about to avoid burning out and stay productive when I am in the trenches.

Rekindling Creativity

Spending some time alone can be a good thing. In fact, it can even boost your creativity. This is a big deal when you’re planning your next move after losing your business. But human beings are wired for social contact (including introverts). Face-to-face contact has even been found to improve our moods and boost productivity at work.

And in my experience, it was in my relationships that I found the renewed spark for the creativity that would help get me back on my feet. As I began to plan my next business, I turned to those closest to me and bounced ideas off them. I wanted their feedback, advice, and criticism before I completely devoted myself to anything new. Ultimately, that led me to cofound my current company alongside a great friend. Without getting back to the relationships that mattered after losing my previous company, that would never have been possible.

John Rampton is the founder of Palo Alto, California–based Due, a free online invoicing company specializing in helping businesses bill their clients easily online. Follow him on Twitter @johnrampton.

loading